Chavez Foe Sees Imitation as Path to Venezuela Presidency

By Charlie Devereux -
Jun 9, 2011

Henrique Capriles Radonski, whose
family members own Venezuela’s biggest movie theater chain, is
emerging as President Hugo Chavez’s strongest rival in 2012
elections by copying his favorite ploy of lavishing public money
on the poor.

Since defeating a Chavez ally to become governor of Miranda
state in 2008, Capriles has set up more than 70 free health
clinics in poor neighborhoods and provides subsidized food to
poverty-stricken families. His government also offers slum
dwellers micro credits to improve their homes.

These programs have helped the 38-year-old become the most
popular of potential candidates in next year’s presidential
race, according to a poll by Caracas-based Consultores 21. His
actions exemplify a new generation of politicians seeking to
defeat Chavez by emulating policies that have kept the self-
proclaimed socialist in power since 1999, said Michael Shifter,
president of the Washington-based Inter-American Dialogue.

“There’s clearly been an evolution in strategy,” Shifter
said in a phone interview. “Before it was just ‘get rid of
Chavez,’ and now there’s a recognition that there’s a reason why
he has been in power for 12 years and retains considerable
support despite such disastrous governance.”

Capriles last month declared his intention to represent the
Justice First party in a Feb. 12 primary that will select a
single, coalition candidate to run in next year’s election.

Ahead in Survey

He had a 55 percent approval rating in a survey of 2,000
people taken by Consultores 21 from March 11 to March 25. His
closest rival, Leopoldo Lopez, a former mayor of the Caracas
municipality of Chacao, had 49 percent while Chavez had 45
percent, according to the poll, which had a margin of error of
2.24 percentage points.

Information Minister Andres Izarra wasn’t available to
comment on whether Capriles is imitating Chavez as he is
accompanying the president on a trip to Cuba, Oscar Lloreda,
director of international media, said in an e-mail.

No date has been set for next year’s elections.

Chavez, 56, remains the candidate to beat even as his
support wanes, said Shifter. The former army paratrooper
deepened what he calls his “21st century socialist revolution”
after winning a second term in 2006 by nationalizing companies
in the oil, food and mining industries. His policies halved
Venezuela’s poverty rate to 28 percent of the population in 2009
from 55 percent in 2002, according to government statistics.

Economic Expansion

Venezuela’s economy expanded at a 4.5 percent annual rate
in the first quarter of 2011, the most in almost three years, as
increased public spending lifted South America’s biggest oil
producer out of a two-year recession that was the region’s
longest following the 2008 collapse of Lehman Brothers Holdings
Inc. Consumer prices rose 2.5 percent in May from April and 22.8
percent from a year earlier, the most among 78 economies tracked
by Bloomberg.

The extra yield investors demand to buy Venezuelan
government bonds instead of U.S. Treasuries was 1,134 basis
points at 6:15 p.m. New York time, the most of any developing
nation in JPMorgan Chase & Co.’s EMBI+ index. Venezuela’s bonds
yielded 963 basis points more than those of Brazil, according to
the index.

Chavez, who introduced currency controls in 2003, on Jan. 1
devalued the bolivar for the second time in a year by
eliminating the preferential rate for so-called essential goods
such as food and medicine by 40 percent, to 4.3 bolivars per
dollar from 2.6, unifying the two fixed foreign exchange rates.

Door-to-Door

Capriles said he plans to woo voters loyal to Chavez by
campaigning door-to-door across the country. While Chavez used a
similar strategy to confound pre-election predictions of defeat
when he first came to power in 1999, Capriles said he isn’t
aping his adversary.

“I’m not seeking to imitate anyone,” he said in an
interview last month during a break in a tour of a poor barrio
of Ocumare del Tuy, a town 70 kilometers (40 miles) southeast of
Caracas. “I am who I am.”

It’s not just Chavez’s folksy style that Capriles is
emulating. As Miranda state governor he has embraced social work
projects similar to Chavez’s “missions,” which provide slums
with free health clinics, literacy classes and subsidized food.
He also joined Chavez last month in condemning U.S. sanctions
against state oil company Petroleos de Venezuela SA for doing
business with Iran.

Nabisco, Cinemas

Little in Capriles’ upbringing would suggest he’d identify
with ordinary Venezuelans or champion the poor. His Jewish
grandfather, who emigrated to the overwhelmingly Catholic
country from Poland after World War II, founded the local unit
of East Hanover, New Jersey-based Nabisco Inc. Members of his
family also own Suramericana de Espectaculos SA, or Cinex, the
country’s largest cinema chain by number of theaters, he said.

As he stumped in Ocumare del Tuy clad in jogging pants,
sneakers, a baseball cap and with rosary beads round his neck,
Capriles said that he would end Chavez’s expropriation policies
and foster economic growth by giving workers stakes in state-
owned enterprises. His policies to eradicate extreme poverty are
modeled on those pioneered in Brazil by former President Luiz
Inacio Lula da Silva, he said.

Twice mayor of the predominantly middle-class municipality
of Baruta, in Caracas, Capriles became the youngest president of
Venezuela’s Congress at age 26. He was jailed for four months on
charges of leading a mob that attacked the Cuban embassy in the
capital during a failed coup against Chavez in 2002.

‘Flagrant Violation’

Capriles said he was trying to calm demonstrators by acting
as an intermediary. His case was thrown out for lack of evidence
and reopened four times by lower court justices. It remains
open. The Caracas-based Venezuelan Program for Education-Action
in Human Rights, or PROVEA, said his case is a “flagrant
violation of the right to a speedy trial.”

Capriles’ presidential bid comes as Chavez’s approval
rating is at its weakest point in eight years, according to
Consultores 21.

Still, Chavez remains a formidable campaigner and is
already boosting spending made possible by higher oil prices and
a rebound in economic growth, said Asdrubal Oliveros, director
of Caracas-based economic research firm Ecoanalitica.

A new windfall tax on oil companies may raise as much as
$16 billion, and if oil prices remain high, Chavez will have as
much as $45 billion to spend on social programs, salary raises
and public works in the next two years, he said.

“If Chavez loses it won’t be for lack of money,” Oliveros
said in a phone interview.

On April 30, Chavez initiated a mission to eradicate a
housing deficit estimated at 2 million units. More than 1.2
million families have signed up, according to the government.

The extra patronage may help Chavez repeat the feat of
2006, when he won re-election with 63 percent of the votes after
seeing his approval rating sink to as low as 36 percent in 2003
when a nationwide strike caused the economy to shrink by 27
percent in a single quarter.

The contest for the presidency will be tight and there are
growing indications Chavez is losing credibility, even among his
sympathizers, Daniel Kerner and Risa Grais-Tragow of the New
York-based political risk research firm Eurasia Group wrote in a
report circulated yesterday.

Crime, Inflation

“Since the country’s main problems, including crime,
inflation, deteriorating economic conditions and a polarized
political environment are unlikely to improve, it is unlikely
that Chavez can significantly reverse these trends,” the report
said.

Chavez, who has accused the opposition of being “lackeys
of the U.S. empire,” may try to exploit Capriles’s family
wealth to discredit him with the poor, said Shifter.

So far, though, Capriles’s background hasn’t distanced him
from the townspeople of Ocumare del Tuy, where dozens of women
mobbed him as they clamored for him to sign letters endorsing
his promise for micro-credits.

So popular has the program become, said Capriles, that
after his walking tours of poor neighborhoods “I sometimes even
find letters stuffed down my underpants.”